Now, Kings XI Punjab faces tax bouncer

CHANDIGARH: After facing an unceremonious ouster following the performance debacle during IPL-3 , the owners of Kings XI are now facing a bouncer from the Central Excise and Service Tax Commissioner , who has slapped a notice of Rs 5 crore for the service tax for the year 2008-09 .

The authorities in the service tax commissionerate are computing the tax liabilities of KPH Dream Cricket Pvt Ltd, the company owning Kings XI, for the current season , sources said. Besides sending the notices, the commissionorate is learnt to have communicated with Ness Wadia, Priety Zinta, Mohit Vivek Burman, the co- partners of the company, to clear the tax liabilities of the company.

Enquiries revealed that the latest notice asking the company to pay the tax liability of Rs 3.09 crore on the total business of around Rs 30 crore was issued in February this year. Sources said the current liabilities were detected during the scrutiny of service tax returns filed by the company for the year 2008-09 . The company did not include this figure in the returns filed earlier.

This was besides an arrear of Rs 1 crore as service tax on the payment of Rs 8 crore made to the foreign players. Besides this, the company also allegedly erred on paying the service tax for brokerage of various deals of the players.

'' Normally, the notice period is for one month but is extendable on the request of the assessee. Since, the amount is not that big, the company may clear it any time. Otherwise , they have the options to appeal in tribunal against the action by Commissionerate,'' said a senior official in the service tax commissionerate , Chandigarh.

Kings XI has got the amount of Rs 30 crore from the BCCI and IPL for the business. Senior officials in the commissionarate office confirmed their plans of issuing reminders to the company as well as its promotors.